NEEF committee sets 2018 cutoff for water release facility funding

The Nechako Environmental Enhancement Fund (NEEF) management committee is doling out $10 million for new projects that will benefit the imperiled Nechako watershed.

Last month the committee decided to allot $2 million to watershed stewardship and tributary restoration, $1 million to Cheslatta Watershed restoration, $1 million to integrated watershed research, $4 million for operating a Nechako White Sturgeon Hatchery and $1 million to facilitate the completion of an environmental assessment on building a water release facility (WRF), according to a 27-page report released on September 12.

Over a period of five years, 80 per cent of the NEEF will be made available for construction of a WRF at Kenney Dam. If certain milestones aren’t met during that timeframe, the remaining funds will be used for other watershed enhancement projects, the committee decided.

“While a WRF option remains a high priority there is clearly an increasing urgency to be doing something now towards other environmental enhancements options in the Nechako watershed,” the report says.

More than half a century has passed since the provincial government authorized the Aluminum Company of Canada (Alcan), now Rio Tinto Alcan, to build the Kenney Dam on the Nechako River, rerouting its natural flow to generate electricity for smelting operations.

Called the Kemano Project, the historical Canadian engineering feat opened northwestern B.C. to industrial and economic development. And in 1961, Alcan started reaping large profits by selling excess electricity to B.C. Hydro, a Crown corporation.

But the project inflicted devastating long-term consequences downstream, starving regions of water flow, impacting fisheries and forcing the Cheslatta Carrier First Nation to relocate some 45 miles away from their now flooded homeland.

Relations between Alcan and the province were dashed in 1979 when the B.C. government rejected Alcan’s proposal to expand the generating capacity of its Kemano power plant. The company, in turn, launched a $500-million lawsuit against the provincial government.

For many years, as various multi-party litigations, disputes and public enquiries casted doubt over any hope for peace or environmental remediation, the Nechako and Cheslatta watersheds continued suffering from the detrimental effects of the Kemano Project.

With legal fees sucking up untold amounts of money that could have been benefitting the damaged watersheds, the province settled with Alcan in 1997, issuing Alcan one last license to extract water from the Nechako Reservoir for aluminum production and granting the company access to alternative power sources thereafter.

As a result of the settlement, the NEEF and the management committee were established to steer funding and remedial efforts to the Nechako and Cheslatta watersheds. Alcan and the province committed $50 million each to the NEEF on a matching dollar basis, the majority of which was going to be used to build a $99-million cold water release facility, the committee decided in 2001.

In 2012, citing almost a decade’s worth of subsequent studies and environmental assessments, and following months of public consultations and internal review, a newly appointed management committee determined that a surface water facility would cost more than $250 million to build.

“The cost was way larger than the amount of money available through the NEEF, and there were risks identified through eight years of study since the 2001 decision that weren’t apparent back then,” said Pieter Bekker, then chair and provincial representative of the NEEF management committee.

“The upside seemed to be lower and the cost was considerably higher.”

Today, the remaining Rio Tinto Alcan obligation to the NEEF amounts to about $38 million. Aside from the question of who will contribute matching dollars, the total potential value of the fund is about $75 million, the report indicates.

Although the 1997 legal agreement didn’t obligate a specific party other than Alcan to contribute to the NEEF, “given the fiscal environment the province is not in a position to provide new dedicated funds to NEEF,” according to Vivian Thomas, communications manager for the Ministry of Forests, Lands and Natural Resource Operations.

“The province will continue to fund its participation on the NEEF Management Committee and may also contribute on an in-kind basis as it continues its work on fisheries in particular,” Thomas said in an email on Oct. 12, 2012.

In the September 2012 report, the NEEF management committee identified “that a WRF is the only way to fully rehabilitate the Cheslatta watershed.”

Now, with the province withdrawing funding, Cheslatta Carrier Nations is proposing to build a WRF at Kenney Dam, an estimated $275-million project that largely hinges on private financing and an electricity purchase agreement with BC Hydro, said Mike Robertson, senior policy advisor to Cheslatta.

“We’re not actively seeking financial support from the province, but we do maintain that the government has a moral obligation to invest in the Nechako after everything it has given to northern B.C.,” he said.

In Vanderhoof, where the diminished flow of the Nechako River is inconsistent at best, hopes of environmental remediation have repeatedly been dashed as the NEEF continues dwindling away.